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Bath & Body Works (BBWI): Surprisingly Strong ROIC & Stock Pitch (Sort Of)

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There are lots of things to dislike about retailers, and it’s especially easy to be dismissive of ones selling soap and candles in malls. But Bath & Body Works (BBWI 31.09 -0.83 -2.60%) capital productivity and track record of growth are probably stronger than you think. The business consistently generates excess returns on capital1 and has grown (organically) well above inflation for a long time, despite likely underinvestment as part of L Brands. It has solid margins, and probably still has a lot of growth ahead of it, even though the stock has stalled post-COVID. While I generally don’t get into valuation in these posts, I will say that BBWI is trading at a reasonable multiple given its potential for sales growth and what should be improving ROIC. If you believe (like I do) that ROIC correlates meaningfully with valuation over time, you should own the stock.

I’ll explain why below.

Background on BBWI

BBWI is the successor entity of Les Wexner’s L Brands after Victoria’s Secret was spun out in 2021. How does BBWI make money? It sells lotions, soaps, sanitizers, and candles in stores and online and considers itself to be the specialty fragrance retailer. The business was started in Ohio in 1990 and did about $7.5 billion in sales in 2022. It has about 1,800 stores in the U.S. and Canada and another 427 stores ROW. Here’s a summary of the product categories, sales channels, and some financial metrics from the 2021 Separation Presentation2:

Bath & Beauty Works Company Description

BBWI’s sales go through these channels (as of 2021):

If you have been to a mall or airport more than once, you likely recognize this company. But just in case, here is a link to a store walk through, and here is the BBWI e-commerce website, where you can get a sense of the product range and pricing. They are selling items for $3 – $60. BBWI’s offerings are considered “affordable luxury:” low-commitment items that instantly make the consumer feel better in some way without breaking the bank. More on this later. First, let’s get into some of the numbers.

Sales Growth & Margins

Here’s the BBWI income statement from 2019 – 20223:

Stock Pitch

You can see sales and earnings grew very nicely from 2019 through COVID (2021 sales were about 45% above 2019), and then slid back in 2022 and then 20234. Comp sales declined more than sales in 2022/23, but at least so far, BBWI has been able to keep a lot of its COVID sales bump. BBWI’s margins also surged during COVID and reverted in the last year or two. Here are some (highlighted) comments from Andrew Meslow (former CEO5) from the quarterly earnings call on November 18, 2021, which from what I can tell, is the first time the company mentioned cost inflation. He provides some guidance on why investors should still think about normalized operating margins for BBWI being in the low to mid-twenties (%) range.

Rising costs are mentioned in more detail on the next call and the one after that (May 2022) in which CFO Wendy Arlin calls out the full-year inflation impact at $225 – $250mm. The margin declines are driven by increasing product costs (raw materials and transportation), and while the company has had some success getting back margin via price increases, it says its ability to get more remains to be seen. The company also mentioned investments in IT and the loyalty program as crimping operating margins a bit as well. The inflation talk culminates with the 4th quarter 2022 earnings call in which the word inflation comes up 20 times. The transcript is worth reading because Wendy Arlin goes into a fair amount of detail on the three inflation buckets (raw materials, transportation, and wages), mentions some other areas of investment via the P&L, and discusses normalized operating margins (targeting 20% but hope to do better). She also says that raw materials inflation alone took 500bps of margin, and that they see the inflation beginning to abate. In the 3Q23 earnings call on November 16, 2023, the company was already citing merchandise margin improvement:  “Merchandise margin rate improved 200 basis points year-over-year, driven by $40 million of deflation benefits, lower product costs and reduced transportation costs.”

How should we think about BBWI’s margins going forward? Here is what Gina Boswell, (current) CEO says:

While the company has no “direct” comps (I have never met a company that thinks it has a direct comp), probably the best public companies to look at are Ulta and L’Occitane (HK listed). Ulta’s gross margin, while reaching about 39% recently, has historically been in the mid 30’s range. Its operating margin is around 16% and at a recent high. L’Occitane has monster gross margins close to 80%, but operating margins are in the low teens. Unlike BBWI, Occitane is comprised of several different brands with varying economics and Ulta is growing faster than BBWI and may be fueling that growth with “investment” via the income statement rendering the margin comparison misleading.

It’s unwise to make too much of these comparables other than to say that they at least superficially suggest that BBWI’s margin targets are within a reasonable range. I also think that BBWI has been pretty successful in raising prices and will continue to, but is understandably sheepish about discussing this in public. Here’s an example of some data from recent JPM sellside on some price increases over time:

I see no reason why the gross margin can’t rebound, and the company’s stated goal of getting to 20%+ operating margins doesn’t seem unachievable given the comps. It’s going to be a combination of price increases, unit cost decreases/deflation, supply-chain cost improvements, and lower customer acquisition costs. Here’s a good recent (December 6, 2023) quote from Eva Boratto (CFO) that frames margin reversion for the company and ties into a lot of other topics that are discussed later in this post:

So Alex, I’ll go back to 2019, right? As we look at the company, we were at about 19.2% operating margins. The algorithm that drove that was strong merchandise margins, right, benefits from that low single -digit, mid-single-digit pricing impact, strong growth in digital and online, and a very productive fleet of stores. And obviously the backdrop of a strong portfolio of product to drive customer demand and growth.

As you look at the last several years where that’s brought us to, right, we’ve – as many industries have, realized significant cost inflation affecting the business to a large extent. Also, to a lesser extent, a step-up in technology investments as well as store operating cost, wage rate pressure, if you will, and some of the costs related to a stand-alone company. So that’s what’s put pressure on our overall margins. As you look at – the tail end of your question, as you look going forward, what’s going to get us to that 45%, 25%, 20% that Gina highlights, right?

First, focused on improved merch margins, continuing to drive that, whether that’s our cost optimization programs, utilization of the beauty, continued cost deflation, a more personalized AUR. We just had a chat about the AUR [Average Unit Retail, aka pricing], right? So ability to return to that AUR is a key contributor of growth. Two, we talked about this earlier, our cost optimization initiative. It’s not one and done. We have to continue to be disciplined around our cost management.

And then finally, turning back to top line growth and the green shoots in the product portfolio and growing our customers through personalization and the loyalty are the formula longer term. And we haven’t hit on this yet, loyalty. We’re — while we have nearly 41 million members in our loyalty program, we’re only a year in and I’d say in the infancy stage of really unlocking value of how we can engage, retain and expand value from that loyalty program.

BBWI’s Trailing & Current ROIC

Now that we know a bit about BBWI’s operating performance over the last few years and ambitions for future margins, let’s look at ROIC. Here are the NOPAT (numerator) numbers:

We already have some understanding of the drivers of the declining NOPAT so there is no need to get into that again. Note the add-back of embedded interest related to operating leases, I run through how I did this in a separate post. On to invested capital, the denominator of ROIC. Here is BBWI’s balance sheet:

Pay attention to how the asset base was far larger in 2020 than it is right now – that’s because of the short-term ($1,2 billion) and long-term ($2.8 billion) assets called “discontinued operations.” These are Victoria’s Secret’s assets and certainly don’t count as invested capital for BBWI, so they need to be removed from the ROIC denominator. Interestingly, Bloomberg fails to adjust for this, and since its invested capital number for 2022 includes 2021 via an averaging of the beginning and end of the year levels, its 2022 invested capital is too high, making ROIC too low. This is probably the case for all databases and screens that use them. It pays to use source data and build your own models!

Here are the correct ROIC calculations and resulting ROIC levels:

And in a chart6:

So, right after the Victoria’s Secret separation, BBWI had strong ROIC because of a big increase in sales and margins (COVID/Digital Sales bumps) without a big increase in invested capital, and ROIC has since decreased steadily Y/Y as NOPAT has declined for the reasons previously discussed. Note also the sizable increase in inventories driving up net operating working capital and total invested capital in LTM and hurting ROIC. Management has attributed this to changing product mix and inflation and expects it to normalize. Despite all of this, BBWI still generates solid returns and economic profits. This is a good business that has grown nicely through COVID and up until then, too. The high ROIC implies the presence of substantial economic goodwill7. That’s what made me look at BBWI in the first place.

How Could BBWI Increase ROIC?

Owners of any business want growth opportunities, and they want to invest for that incremental growth in low-risk ways at high rates of return. I think BBWI has opportunities for both, and since this blog is about ROIC, I think of these initiatives as components of an ROIC thesis: high-return capital investments (e.g, new stores, remodels, intangible investment in the brand and the app) and capital-light profits (e.g., the franchise business) or low/no cost sale growth and fixed cost-cutting measures that lead to higher NOPAT. Of course, these are also elements of a cash EPS growth thesis for the company. Regardless, here is what the company is working on to achieve increased economic profits for shareholders:

I will go through each one of these. Unfortunately, we just don’t have enough numbers to bracket the future financial impact of some of them (e.g., the loyalty program) but we can still get a flavor of the sources of what I view to be meaningful growth potential and strong return on incremental invested capital for BBWI.

Cost Saves

The company has been talking about a cost-cutting initiative for the last year or so. From the 2022 annual report:

“We are working to evaluate our cost structure and take action to offset what we see as ongoing cost pressures in both gross profit and general, administrative and store operating expenses, as well as to fund strategic investments. Our efforts are broad-based with opportunities in transportation, product margin, store operations, home office expense and indirect spend. We are early in this process, but we are targeting eventual annual cost savings of $200 million. We expect to realize over half of these savings in 2023, primarily in the second half of the year. We expect to realize a substantial portion of the remaining benefits in 2024.”

Here’s the latest on this, per the November 16, 2023 earnings call:

“Finally, we are enhancing operational excellence and efficiency through $200 million of planned annual cost savings across the company. We are on track to deliver approximately $150 million of those savings in 2023.”

Here is a presentation the company made in July 2022 about supply chain investments that should dent costs too. Fixed costs were about $1.9B in 2022 and EBIT was about $1.4B, so if they hit the $200 million, all else equal, it provides a meaningful uplift in earnings.

Sales Growth

Per the income statement pasted above, we know the company saw 40%+ revenue growth through COVID and despite a bit of backsliding since then through the most recent quarter, it has held on to most of it. What about before COVID? We don’t have full historical financials for BBWI because it was inside of L Brands through 2021. But we do have some top-level information from the 2021 Separation Presentation that shows the company has been a solid sales grower for quite some time, both on an absolute and comp basis. Here is what we have for straight sales growth:

This looks like a sales CAGR of about 7% from 2010 – 2019. Of course, we don’t know how much capital was invested (i.e., new store leases, fixed assets, working capital) to get this growth because we don’t have stand-alone balance sheets for BBWI going back that far. But we do know that comp sales were solid. This deck slide below from the 2021 Separation Presentation is not going to win any Edward Tufte readability awards, but it does seem to indicate that comps grew mid to high single digits during that same pre-COVID decade:

But note that these comps do include direct sales, which is the same as digital sales – the company uses these terms interchangeably. We don’t have direct sales before 2016, but from what I can tell pulling direct and international sales out of total sales (there was also a change in reporting around 2019/20 which makes some revenue numbers a little inconsistent), it shows that store-only comps were still 5%+. So, in contemplating future sales/comps growth, one thing we can say is that BBWI has done it in the past at both the company and unit levels; we are not looking for some kind of turnaround or reinvention of the business going forward. That’s reassuring. Note also that the comps do include digital/direct sales, discussed below.

But where will the sales growth come from? In the 2021 Separation Pesentation management broke this down for us via two key bridge charts: (1)product levers and (2) sales channel levers. Assuming 4 years from 2020, these charts imply a sales CAGR of about 12%. From what I can tell the company has stuck to this framework since that time. Let’s look at growth from products first. BBWI envisions $3.5B of sales growth over 2020 total sales to come from growth in Fragrant Body Care, Home Fragrance, Soaps & Sanitizers, and also new products:

Here’s some color on product from Julie Rosen, President, from the August 23, 2023 earnings call:

Yes. Thank you for that question. So though the home fragrance and soaps and sanitizers categories are normalizing post pandemic. We have gained unit share year-to-date, and we are a market leader in these categories and plan to build on that position. We do continue to innovate and position for growth in these categories. For example, wallflowers [scented candles], as I mentioned, continue to outperform. So we’re leaning into that demand. We also recently refreshed our core soap offering, including the completed rollout of our new formulation made without paraben, sulfates and dyes and additionally rolled out our foaming hand soaps and recyclable cartons. So we are absolutely focused on our core businesses and innovating in them to drive growth to 2019, all categories are up significantly in the double digits. So no category is below.

Thanks, Dana. Nice to hear your voice. So starting with the new products, we have launched a lot of adjacencies that we are starting to test, optimize and roll. So I just want to review them very quickly. and
then I’ll talk to your margin question about them. So in men’s, as you know, in the second quarter, we successfully launched men’s grooming. And in September, we’re following with men’s hair and shave. We continue to focus on APDO as it is the #1 form in the men’s market. And men’s continues to be our fastest-growing category in body care. The men’s margin is commensurate with the shop.


So we’re very excited about that. Fragrance hair care in the second quarter was launched to 560 stores and online in July, and the launch has exceeded our expectations, and we expect to complete that rollout to all stores next spring. We also have lip as we work to broaden our customer base and attract a younger customer. We’re upgrading, we’re expanding and we’re relaunching our in-store assortment and visual presentation of our [ lip ] products across limited number of stores in the third quarter. Additional expansion will happen next year. And then finally, of course, there’s laundry, which we are very excited about to be launching this month across a limited number of stores and online.

So initial customer feedback from our preview sample event has been very positive with customers noting that our laundry detergent is an exciting way to add another layer of their favorite scent to their daily routines. Others are not quite there yet, but we have a long-standing history here at Bath & Body Works. As you’ve seen with wallflowers and 3-Wick over the years, that with scale, we have no doubt that we will get there.

Here are links for the new products she mentions (the company describes the products better than I can):

BBWI has a long history of successfully refreshing products and creating new ones that appeal to its customers. But will these particular products propel the sales growth the company is projecting? Of course, that’s hard to say – we don’t even have enough granularity from the company to know how much it has sold of which products since 2020.

As an aside, here is an attempt by Goldman Sachs (December 2021) to estimate the EPS bump and value per share of BBWI’s new haircare and skincare offerings:

I applaud the effort! Some customer surveys and other primary research on the search and purchase transaction volume of these products on the Internet and via credit cards could give us help give us some idea of how these are going, and I am in the process of doing that. Hopefully, the company will provide more granularity on them in the coming quarters as well.

Moving on to the sales channel levers from the 2021 Separation Pesentation :

The first step up from 2020 is North American Stores sales growth8. As of May 2021, the company had a base of about 1,750 stores:

The point of this chart is to show investors that BBWI isn’t very exposed to the dreaded B or D malls, which is a big concern as these malls die off and retailers are stuck with lease obligations and no foot traffic. This group of slides also says that 99% of BBWI stores are cash flow positive, and shows a return on sales (basically the operating margin on a store-unit basis) of 36% for off-mall down to 33% for D or lower. These are healthy stores. The average remaining lease term is 2-5 years. New store payback is about 2 years. The company also showed nice sales PSF growth up until COVID hit in 2020:

The store-level performance seems supportive of the idea that BBWI should grow the net store count (they are focused on off-mall for new stores) and it seems like they are doing it judiciously: at the time of the separation from Victoria’s Secret, the company planned a low single-digit store growth rate. Here is some store count and sales PSF data from the 2022 annual report:

As of 3Q23, the store count had reached 1,843 (with 25 added in 3Q23), which seems a bit below the 2021 plan so far, but it’s early. Back-of-the-envelope, if BBWI adds say 70 net new stores a year that is about $210 million in incremental company sales annually from new (normalized) stores, or $800 million over say 4 years. This represents meaningful revenue growth, but BBWI is going to have to open stores at a faster rate to hit its $2.1 billion number in the bridge chart above – if that number is driven entirely by new store sales. COVID has had a positive impact on new store prospects for BBWI as rents have dropped and more choice locations are available than ever before; presumably, the company is taking advantage of this.

White Barn Remodels

What about the reference to the White Barn concept in the bridge slide? The White Barn name came from BBWI’s candle line. From what I can tell BBWI began making White Barn home fragrance products more prominent in their stores, and this morphed into an overall remodeling initiative called White Barn. Here’s a slide on it from the 2021 Separation Presentation:

White Barn remodels have been discussed by the company at least as far back as the early 2010’s, and back then BBWI was citing 20-25% sales bumps from these cap ex investments. But even a 15%+ increase in the first year on a sales base of about $3mm per store is about a $450 thousand per renovated store sales bump. I don’t think any numbers have been given on White Barn investment per remodeled store (please let me know if I missed it), but given the solid store unit economics, it seems safe to say these remodels are strong ROI investments for the company. If BBWI is remodeling about 150 stores per year that’s about $68mm per year in incremental revenue from those stores, plus the cumulative impact of prior year remodels, and this should all be compounding at the base growth rate of sales for all stores. I’m not sure this adds up to a big portion of the $2.5B incremental sales bump from North American Stores (maybe 10-20%?), but it is meaningful.

Digital/Direct Sales

Digital represents all the BBWI products sold on the company’s website, excluding BOPIS (Buy Online Pickup In Store), which is allocated to store sales. BBWI has a mix of web and physical presence that is somewhat ideal. It has a large Internet business that already has scale advantages and is growing but also a sizable physical store base of small foot-print stores that facilitates BOPIS and BORIS (in my opinion is a big advantage over e-commerce-only retailers) and keeps the brand and products in front of shoppers in the real word. Here is how Direct/Digital sales breaks out vs. Store Sales and International/Franchise (discussed in detail further down):

In 3Q23, direct was about 20% of total sales, down from closer to 31% in 2020. Note that the bulk of the backslide in total sales post-COVID is driven by Direct Sales, which makes sense: BBWI picked up a lot of new e-commerce customers spending money on sanitizer products and house comfort stuff during COVID-induced WFH and general hibernation, and that has since dissipated. Remember that the company guide to about $1,500 in incremental sales growth via digital over 3-5 years from the base of 2020 sales in the 2021 Separation Presentation:

So far it hasn’t gotten any of this $1.2 billion as Direct Sales have declined since 2020, per the segment breakout above. An analysis of the digital business overlaps to some extent with the loyalty program, which I view as the nervous system running through the entire business. It should be the driver for growth and valuation multiples going forward so let’s dig into it below.

Loyalty Program

As of the earnings call in November 2023, BBWI’s loyalty program, called My Bath & Body Works, had about 41 million members, which comprised about 2/3rds of the company’s customers and 3/4 of company sales since the launch in 2022. This is not a trivial part of this business. It’s a pretty large percentage of the customer base and total sales, and the member count also has to be a high percentage of BBWI’s addressable market of consumers. I think the loyalty program will be a big part of the sales growth and margin improvement stories for the company in the future. Since the loyalty program also has the potential to make BBWI a more subscription-like “club” business, or at least make revenue more predictable and profitable, I think it could also help distinguish BBWI from typical specialty retailers and increase the stock’s valuation multiple over time. The company seems to be headed in this direction, as management used a lot of subscription business-type language in the slides on the loyalty program in the 2021 Separation Presentation. For example:

Retention rates, customer lifetime value…Sounds like Amazon Prime! OK maybe not, but I do think this general framework makes sense, and all things considered, I would even say the loyalty program is the future of BBWI, if things go well.

How My Bath & Body Works Works

I’ll briefly summarize the program and get a little more into my thinking on this below. I have also included this document which compiles much of what the company has said about the program in earnings calls and investor presentations since 2021. After some pilot program testing going back to 2020, My Bath & Body Works was officially launched in 2022. It’s not unlike other programs consumers are familiar with: BBWI gathers email addresses and other customer data on its website at stores and invites customers to create accounts and download the app. Customers can shop directly from the app and get points for both app and in-store purchases. These points are tracked in the customer’s account (like airline miles) and can be spent on purchases of eligible items. Customers also get free rewards.

Here’s what My Bath & Body does for the customer:

Here’s what the app does for BBWI:

Gina Boswell’s comments on the November 16, 2023 earnings call about the company’s digital efforts moving from a purely transactional website to a more experiential platform resonate here, and are worth reading.

In short, a well-done app is an incredible customer engagement tool, and I think it’s exceptionally relevant for affordable luxury consumer products like BBW’s because the products are low cost, are cheap to ship, can be bought with high frequency, work well with web-based content tie-ins to products (e.g., seasonal or holiday-specific editorials, testimonials, blog posts), and present well on a phone or computer screen. BBWI isn’t selling Ferraris or luxury handbags or health insurance – its products are simple impulse purchases or gifts that can happen relatively frequently, and that works very well for an app. Since BBWI has a sizable store base and a 30 year + old brand behind the app, it also has a big advantage over other DTC companies that offer similar products.

Here’s some encouraging app download data from a January 2024 Goldman Sachs sellside piece:

BBWI should be able to use the app to increase ticket sizes and purchase frequency, attract new customers, and acquire customers and sales more cheaply. How can we think about the app from an ROIC standpoint? The company has said it has invested in the loyalty program via elevated operating expenses. We don’t know how much exactly, and we know that this is not a one-time thing – the app requires ongoing maintenance and development. This is a classic example of an intangible investment that should be recast from an expense on the income statement to an asset that’s part of invested capital for ROIC purposes, though the numbers here are likely too small to matter much for BBWI’s ROIC. We also don’t have much to work with in terms of incremental income from this investment – all we know is that digital revenue (which includes the loyalty program) is still below 2020, and the company guided to a $1.2B bump from 2020 over 3-5 years. The app is now more than a year old and hopefully, more details on it are coming.

Franchise/International

BBWI has a franchise model for its international stores, and it’s somewhat of a jewel. Here’s how BBWI described it in its 2022 10K:

As of 3Q23 the international store base reached 458 which represents solid unit growth from the 2021 Separation Presentation, which showed 290 stores, along with a map of where the stores are:

BBWI international revenue has two components: royalty fees, and wholesale revenue from products sold to the franchised stores. I haven’t been able to find anything that shows margins here, but the company describes its franchise business as “highly profitable” and it’s safe to say it’s very high margin compared to the rest of BBWI. The international business seems to be a great way to monetize the brand recognition BBWI has been building since the early 1990’s, and as of the 2021 Separation Presentation the company was guiding to a $250mm sales increase over 2020 over 3-5 years:

Per the segment breakout above, it looks like they have already gotten about half of this amount – TTM franchise revenue as of 3Q23 was about $340 million. In 3Q23 International sales declined mid-single digits Y/Y and here is what management had to say about it (3Q23 earnings call): 

Our total international system-wide retail sales again posted double-digit growth in the third quarter. However, wholesale revenue declined as our partners manage their inventory level. Also, since the conflicts began in the Middle East in October, sales for certain franchise partners have been pressured. We continue to monitor the events and consumer sentiment in the region and support our partners accordingly.

Assuming the wholesale revenue dip is truly inventory-driven and transient, the franchise business seems like a pretty reliable grower. While its sales are a small portion of total revenue, remember that it’s likely very high-margin revenue, so a big chunk of that $300 million + is going to NOPAT and therefore having a significant impact on it as it grows. I wonder why BBWI can’t add more franchise stores more quickly – does it have to do with being able to find capable and trustworthy franchise partners? It would be great to hear more about this.

Final Thoughts

DTC health and wellness consumer products have exploded in the last decade as dozens of startups have managed to capture billions of dollars of sales with scrappy social media marketing and PPC campaigns, not to mention riding the growth of platforms like Amazon. I’ve seen the pitch decks for these companies – the growth and gross margins are truly stunning, and a lot of it is recurring, subscription-based revenue. BBWI has been a major player in this category for 3+ decades and has a perfectly good business but it could have done a lot more during this time, in my opinion. Still, I think that there is ample profitable growth ahead for BBWI, if they invest well in their digital business, new stores, and franchise business. Some remaining items worth mentioning:

  1. AKA economic profits. Graphic courtesy of Aswath Damodaran ↩︎
  2. This presentation from 2021 has the most substantive information available from the company that I could find so I will reference it a lot in this post ↩︎
  3. Note that BBWI’s fiscal year ends at the end of January, but it still uses the calendar year for its reporting. For example, the fiscal year ending January 2024 is still referred to as the 2023.
    ↩︎
  4. 2023 includes consensus estimates for 4Q23.
    ↩︎
  5. BBWI has had 3 CEOs in the past few years: Andrew Meslow, Sarah Nash (interim), and Gina Boswell (current) ↩︎
  6. This is the chart of ROTC i.e., goodwill and other intangibles are excluded from invested capital. I think BBWI’s goodwill of about $600 million comes from L Brands’ acquisition years ago of Intimate Brands, but I’m not sure? If it is, it’s a good example of why goodwill should be excluded from ROIC calculations, because it has absolutely nothing to do with how BBWI currently makes money. ↩︎
  7. “Businesses logically are worth far more than net tangible assets when they can be expected to produce earnings on such assets considerably in excess of market rates of return. The capitalized value of this excess return is economic goodwill.” Berkshire Hathaway 1983 Annual Letter ↩︎
  8. This includes U.S. and Canada company-operated stores ↩︎

Please email me with questions/comments/errors related to this post!